A Bitcoin ATM is a standalone kiosk that allows you to withdraw and deposit cryptocurrencies and exchange them into fiat (and vice versa) quickly and conveniently. In this article we tell how to use a Bitcoin ATM in just three simple steps.
How to use a Bitcoin ATM
Using Bitcoin ATMs is a simple and intuitive process that avoids interaction with cryptocurrency exchanges and keeps confidentiality at the same time.
Using a Bitcoin ATM is no more complicated than withdrawing cash from a traditional fiat ATM: while a traditional ATM is connected to your bank account, a Bitcoin ATM connects to a blockchain that makes a crypto-transaction directly with the correct wallet, exchanging fiat for cryptocurrency.
These crypto-transactions are in no way linked to your fiat bank account and are not managed by banks or other centralised financial institutions. In most cases, you do not need to provide any personal information to make transactions using these ATMs.
Many countries have their own rules regarding Bitcoin ATM transaction limits and the information required to use the service. If strict withdrawal and deposit limits are exceeded, KYC data including name, phone number, address and even a scan of identification may be requested. However, these rules only affect a low number of the crypto transactions made.
It is also important to remember that Bitcoin ATMs charge a fee, which varies from 4% to 20% and is often higher than a cryptocurrency exchange (where the fee is usually between 0.1% and 2%). If you are comfortable paying this fee, Bitcoin ATMs are an excellent choice.
The only obstacle you may face is the fact that finding the nearest Bitcoin ATM is not easy. Unlike fiat ATMs, which can be found all over the world, Bitcoin ATMs are not located in all countries. There are currently just over 37,000 Bitcoin ATMs around the world.
However, once you find one, you only need to carry out a few actions to use it.
1. Get a cryptocurrency wallet.
The first thing you will need is a cryptocurrency wallet, which will receive the currency you have just bought. There are several types of cryptocurrency wallets available to users: online, mobile, desktop, hardware and paper.
Since you will be using a Bitcoin ATM that requires you to be physically present at a particular location, the most convenient option is to use a wallet that supports the mobile version.
After setting up your cryptocurrency wallet, you will get the address to which you will receive the cryptocurrency you have just purchased.
2. Enter the required information and wallet details.
Using a Bitcoin ATM, follow the prompts and instructions on the screen. You need to scan the QR code of your bitcoin address, which is the address to receive the funds.
To do this, open the QR code on your phone and let the machine scan it.
3. Deposit cash and get your cryptocurrency.
Then enter the amount of cryptocurrency you want to purchase and deposit the equivalent amount of fiat currency into the ATM. For large transactions, you may be required to undergo identity verification.
After confirming the transaction, you will receive a receipt showing the amount of currency purchased minus the fee.
Then you should see the unconfirmed crypto-transaction in your wallet. It can take from 10 minutes to several hours for the transaction to be successfully validated. This is not due to the Bitcoin ATM, but to the inner workings of the blockchain.
The process of selling cryptocurrency at a Bitcoin ATM is very similar to buying and also requires only a few steps:
1. Find an ATM and enter your details.
Select the sell option on the Bitcoin ATM screen and enter the desired amount of cryptocurrency to be sold. This option is done in fixed fiat denominations, as the Bitcoin ATM must issue this amount after a successful transaction.
You will see the equivalent amount on the screen.
Select the option to sell the cryptocurrency.
2. Send your bitcoin.
You will see the bitcoin address to which you should send the cryptocurrency to sell.
Scan the QR code of your mobile wallet and send the currency to the specified address.
The transaction must go through blockchain validation before the ATM will dispense the equivalent amount in fiat. Since this may take some time, Bitcoin ATMs print a receipt with a QR code, allowing currency redemption later, when the transaction is confirmed.
3. Pay off the receipt and get the cash.
Once the transaction is confirmed, visit the Bitcoin ATM again, enter/scan the QR code of the redemption and receive the cash.
Bitcoin ATMs offer an easy and quick way to buy and sell cryptocurrency as well as provide a direct link to cash that is not often seen in the world of digital assets. So there is no surprise that the use of Bitcoin ATMs alongside traditional fiat ATMs is becoming a part of everyday life.